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Accounting winds of change—new accounting rules for financial instruments are coming
Author(s) -
Parks James T.
Publication year - 1990
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/jcaf.3970020202
Subject(s) - accounting , balance sheet , mark to market accounting , accounting standard , financial accounting , accounting information system , business , executive summary , accounting management , financial ratio , finance , financial instrument , positive accounting , economics
Accounting rules for financial instruments and financial institutions are changing. The astronomical cost of financial institution failures has forced a reexamination of accounting principles for all financial assets and liabilities, regardless of whether they are currently recorded either on or off the balance sheet. Some regulators are advocating more market value accounting and disclosures to provide a fuller picture of institutions' economic health and the risks posed by new, innovative financial instruments. The Financial Accounting Standards Board (FASB) and the Accounting Standards Executive Committee (AcSEC) of the AICPA are trying to address many of these complex accounting issues. How they resolve these issues may affect a company's financial reports in ways not currently imagined. (The views expressed in this article are the author's and not necessarily those of Fannie Mae or the Savings and Loan Associations Committee of the AICPA of which he is a member).